Stocks extended their September losing streak on Tuesday, but managed to end the day well above their earlier lows as investors continue to digest weak economic signals and the ongoing European debt crisis.
The Dow Jones industrial average closed at 11,139.30, down 100.96 points or 0.9 per cent – a vast improvement over its 300-point dip earlier in the day. The broader S&P 500 closed at 1165.24, down 8.73 points or 0.7 per cent. In Canada, the S&P/TSX composite index closed at 12,518.54, down 83.87 points or 0.7 per cent.
The day began looking exceptionally weak, with investors recoiling from the 5 per cent loss by Germany's DAX index on Monday. The better-than-expected reading on the ISM non-manufacturing index for August, which showed continued expansion in the U.S. service sector and beat economists' expectations, did little to curtail the selloff.
At one point, all 30 members of the blue-chip Dow were in the red. By the day's end, though, Pfizer Inc. had risen 1 per cent and Johnson & Johnson had risen 0.9 per cent.
Financials remained among the weakest components, though. Bank of America Corp. fell 3.6 per cent and JPMorgan Chase & Co. fell 3.4 per cent. General Electric Co. fell 3.2 per cent and Alcoa Inc. fell 2.2 per cent.
In other moves, International Paper Co. rose 8.9 per cent after it reached an agreement to buy Temple-Inland Inc. for $3.5-billion (U.S.). In Canada, Research In Motion Ltd. bounced 3.5 per cent after an activist investor, Jaguar Financial Corp., called on the BlackBerry maker to consider strategic options, including the sale of the company – raising the pressure on the company, whose share price has suffered this year.
Meanwhile, gold retreated to $1,873.30 an ounce as the U.S. dollar rose – although gold producers fared well: Barrick Gold Corp. rose 2.3 per cent. Crude oil fell to $86.02 a barrel, down 43 cents. Suncor Energy Inc. fell 2.4 per cent.
David Berman